A trust is a legal arrangement in which a trustee is assigned to hold and manage assets for the benefit of beneficiaries. As fiduciary for the beneficiaries, the trustee holds legal title to trust property and assets, handling them according to the trust terms, for example, investing, distributing, and paying taxes on income and capital.
A trust is also an estate planning tool to organize, transfer, and protect your property. The three main parties to a trust are the settlors, trustees, and beneficiaries. Each of these three parties may be one person or several people.
Why set up a trust? A trust is used for many reasons:
Family trusts, also known as family trust funds, are created to protect your assets and to benefit your family beyond your lifetime. When your assets are held in a family trust, you no longer have legal ownership of them as they are held by the trustees for your family’s benefit.
Typically, people would set up a family trust to get some benefit from not having personal ownership over their assets. A family trust can be used to:
Special Needs Trust
A special needs trust is one that is set up to benefit a child, spouse, or family member with special needs, to ensure that they will be able to receive and use the money and assets you leave behind for them in the way that you intend.
Setting up an irrevocable trust for someone with mental incapacity or physical disabilities has the following benefits:
A charitable trust can be set up in Singapore if you wish to set aside some of your assets or income for charitable causes. Here are some benefits of creating a charitable trust:
Depending on their intentions, a settlor may create a revocable living trust, an irrevocable living trust, or a testamentary trust. In a living trust, a settlor transfers their assets to the trust, either with or without the right to terminate or amend the trust. The testamentary trust is created within a will, which takes effect after the settlor’s death.
Why choose a ? Not only are trusts more versatile for complex estate plans, but, more beneficiaries and pay off debts upon the settlor’s death. Unlike wills, moreover, living trusts take effect while you’re alive, so you can see your estate planning at work.
Trusts have many purposes to fit diverse circumstances, from complex multi-generational wealth protection to philanthropic gifts to charities.
A trust may allow the trustee greater or lesser discretion in distributing trust income and capital to beneficiaries, whether the beneficiaries are spouses, children, business entities, employees, charities, special needs children, non-residents or the settlors themselves.
Some trusts have mixed purposes to achieve multiple aims. Unlike wills, you have practically limitless options on how a trust can be used.
To set up a trust in Singapore, you need to prepare a document that satisfies specific legal formalities:
In other words, you need a document that declares your intention to transfer specific assets to named legally eligible beneficiaries to be held by a named trustee.
The document must contain this definite language to conform to trust law, and you must be legally and mentally capable of creating the trust.
Since trusts can be rather complex, it’s best to hire an experienced estate planning attorney to help you accurately express your wishes in a legally viable trust.
Here at Kith & Kin Law we offer transparent fees and setting up trusts starts from S$2500 nett.
Everyone has their own unique legacy they wish to leave behind. Through our purpose-driven ethos, we will help you craft out a personalised plan on how you wish to incorporate your legacy plan with your estate plan.
The process starts with a paid consultation of 60 minutes for S$175.
Meetings can be in-person or over ZOOM.
Based on what has been agreed upon during the meeting, we shall start the process in fulfilling your legal requirements.